Grant and restricted-fund records for Ottawa nonprofits

Read the agreement before setting up the fund

Record the approved purpose, eligible dates and costs, reporting milestones, matching requirements and any repayment terms. Build a fund or project code that follows the agreement rather than creating a new bank account as the only control.

Nonprofit organizations and registered charities are not interchangeable. Their tax and information-return responsibilities differ, and the ability to issue official donation receipts depends on the applicable qualified-donee rules. Confirm status before writing a receipt or assigning a filing responsibility.

A grant report and a bank balance can disagree for good reasons

Illustrative example: an Ottawa association receives $50,000 for a program and pays $18,000 in eligible costs. It also owes an approved $7,000 supplier bill. The bank movement suggests $32,000 remains, but the program has committed another $7,000. A report showing paid, accrued and committed amounts makes the $25,000 uncommitted position visible.

The accounting treatment of the grant receipt depends on the organization’s reporting framework and policy. The example is a funding-control schedule, not a universal instruction to recognize the entire receipt as revenue.

Give the board a report it can act on

• Funding received, with the funder and restricted purpose.
• Approved budget, actual eligible costs and remaining commitments.
• Allocation method for shared staff time, rent or other common costs.
• Receipts, invoices, approvals and payroll support for each reporting period.
• Amounts outside the agreement, questions awaiting funder approval and potential repayments.
• The due date, responsible person and confirmation for each report.

Separate donations, sponsorship and program sales

Keep the payer’s purpose and agreement with the transaction. A sponsorship that gives a business promotion or other benefits is not automatically the same as a charitable donation. Ticket sales, memberships and grants can also have different sales-tax implications.

Close the general ledger and reconcile the grant schedule to it before sending a funder report. That avoids one set of numbers going to the board and a different unsupported set going to the accountant. Retain the final submitted version and any funder correspondence.

Put this into practice

• Board and management reporting →
• Nonprofit bookkeeping →
• Assess the bookkeeping workload →